Automotive News - May 13, 2024 - 46

46 * May 13, 2024
Despite Musk's criticisms, Tesla might be using lidar
Luminar's Q1 financial
disclosures say company
is its biggest customer
Pete Bigelow
pbigelow@crain.com
Tesla CEO Elon Musk has frequently lampooned
lidar, a sensor that most other automakers
and tech companies say is essential
for self-driving vehicles.
" They're all going to dump lidar is my prediction, "
Musk said. " Mark my words. "
Instead, it appears that Tesla is now using
lidar sensors.
Lidar supplier Luminar Technologies Inc.
said last week that " Tesla was our largest lidar
customer " in the first quarter, according to
the company's quarterly financial disclosures.
TOYOTA
continued
from Page 8
2025, retreating from the just-achieved
records.
Looking ahead, Toyota executives
forecast global retail sales to drop 1.3
percent to 10.95 million this fiscal year,
from last fiscal year's high. Operating
profit is pegged to slip 20 percent to
$28.4 billion through next March, and
net income is expected to fall 39 percent
to $23.6 billion.
Giving back
The slowdown is part of an intentional
pause Sato outlined early this
year as part of an effort to regroup and
stay profitable for the long run after
sprinting to record sales and production.
" Now
we can manage the timing of
our investment, " Sato said.
The company needs to take stock of
the way it does everything in an effort
to boost efficiency and think outside
LEGAL
continued from Page 8
Dan Rustmann, co-chair of Detroit law
firm Butzel's global automotive group, said
the legal back-and-forth between Stellantis
and Yanfeng has been a major discussion
point among suppliers that his law firm
works with. He said Stellantis' approach to
cyberattack liability stands out from other
automakers.
" In every cybersecurity incident I've been
involved with, no client has sought to debit
or charge the supplier for downtime in connection
with a cyber incident that causes
some disruption - other than Stellantis, " he
said. " They're the only one. "
While the supplier world waits to see how
the Yanfeng-Stellantis legal situation resolves,
companies should make sure they
have the best possible cybersecurity protocols
in place, Rustmann said.
" Because there have been so many attacks
in recent years, and because they're so expensive,
many companies are taking significant
measures to try to prevent it, " he said.
" But you can have the best measures in the
world and still be vulnerable. "
2. Noncompete ban
The Federal Trade Commission in April
enacted a national ban on most noncompete
agreements, which businesses have used to
prevent employees from leaving to competitors
with company secrets.
The ruling is being challenged in court, but
it is already forcing suppliers to re-think how
they keep confidential information safe, said
Sales to Tesla made up more than 10 percent
of Luminar's quarterly revenue, the company
said.
Tesla represents a signature new customer
at a time that Luminar's stock price has dwindled.
Luminar this month laid off 20 percent
of its workforce and announced a corporate
restructuring.
For Tesla, the developments come at an
equally turbulent time. The company has
conducted its own series of layoffs, which included
the entirety of its EV charging team.
Luminar's financial documents did not detail
how Tesla is utilizing lidar sensors. Musk
anticipates unveiling a robotaxi Aug. 8, and
that would be one likely vehicular landing
spot for Luminar's sensors.
Tesla did not respond to a request for comment.
Luminar declined to elaborate.
Previously, Tesla has launched the Autopithe
box for a new era of global competition,
Sato said. Each employee is expected
to devote 30 minutes a day to
thinking about improving their own
work and careers.
" Existing workloads should be reduced
for the time being, " Sato said.
" We should question whether a particular
work is necessary or not. We
might need to stop certain types of
work. "
Early this year, Toyota also decided
to pay its suppliers higher prices. Then
it gave its Japanese workers their biggest
wage hike in 25 years. And in
April, it decided to tap its record profits
to pay dealers in Japan $71 a month
for every person they employ.
Records, more records
Toyota can afford the breather
thanks to a stellar year of financial
achievement.
For the full fiscal year ended March
31- Sato's first year at the helm -
Toyota booked all-time highs in global
lot and " Full Self Driving " driver-assistant
systems without the sensor, which uses lasers
to depict a vehicle's precise location and to
detect obstacles. Tesla has instead relied upon
cameras, and sometimes radar, for those
tasks.
Each sensor has strengths and weaknesses,
and most automakers use a combination of
those sensors for both driver-assist features
and automated driving. Luminar launched its
first production lidar sensor on the Volvo
EX90 early this year.
Lidar has historically been the most expensive
sensor for vehicles, which is one
reason Musk has frequently eschewed its
inclusion.
" In cars, it's freaking stupid, " he said during
an appearance in December 2020. " It's expensive
and unnecessary. You have expensive
hardware that's worthless on the car. "
sales, production, revenue, operating
profit and net income.
Operating profit nearly doubled to
$35.4 billion, outstripping even the
company's latest upward forecast revision
from February.
Net income more than doubled from
the previous fiscal year, reaching a record
$32.7 billion. Revenue jumped 21
percent to $298.1 billion, rounding out
the financial record trifecta.
The Japanese giant produced a record
11.2 million vehicles in the fiscal
year ended March 31, including output
from Daihatsu and Hino. That total
was up 4.5 percent from the previous
fiscal year, for a third straight year of
increases.
Global retail sales climbed 5 percent
to a record 11.1 million vehicles in the
just ended fiscal year, including Daihatsu
and Hino. Booming sales of hybrids
powerd the surge.
Sanshiro Fukao, an auto analyst and
senior fellow at Itochu Research Institute,
said Toyota and other Japanese
Zainab Sabbagh, a partner in the Detroit office
of Warner Norcross + Judd.
" Even though you are getting rid of noncompete,
that doesn't mean there aren't other
ways to protect your business interests, "
she said.
Sabbagh said parts makers could introduce
targeted nonsolicitation agreements
with their suppliers to prevent them from
competing for the same programs or customers.
Likewise, suppliers should review
their employment agreements to make sure
that any nondisclosure agreements explicitly
lay out what information is considered
confidential that an employee could not
share if he or she leaves for a job at a competitor.
" Most
of the time, the court is going to
limit you to what you defined as confidential
in your agreement, " she said. " So if you
haven't defined what's actually important
to you, you might be out of luck if you go to
court. "
3. Payment recoveries and delays
Suppliers large and small have been going
to their customers in recent years seeking
pricing adjustments for higher material and
labor costs following years of reduced profits.
Suppliers have reported mixed success.
In recent months, automakers and larger
Tier 1 suppliers have been asking their parts
makers to extend payment lengths or delay
them outright to help them deal with costs
related to electric vehicle program investments
and software technology.
Some suppliers have been able to accommodate
those requests, but others have
BLOOMBERG
Tesla is buying lidar sensors, according to Luminar
Technologies, a development that marks a 180-degree
turnaround from CEO Elon Musk's earlier criticisms.
automakers need to channel that success
into better product and more advanced
technologies, especially in the
digital arenas, to catch up to Chinese
rivals.
" The battlefield of the auto industry
seems to have started switching from
electric vehicles to artificial intelligence
rapidly and drastically, " Fukao
said. " If Japanese OEMs spend a lot in
R&D expenses or seek alliances with
AI developers, it could decide their
survival in the car industry. "
Hybrid highs
Toyota sold some 3.7 million hybrids
in the just-ended fiscal year, up 32 percent
from 2.8 million year before. Gasoline-electrics
made up a third of
global volume, up from 26 percent.
By contrast, Toyota
sold 116,654
pure EVs in the fiscal year ended
March 31. Still, that was more than triple
the number it sold the previous
year and up from exactly zero EVs in
2020.
raised concerns about not being able to afford
waiting for a payment.
" You can imagine the heightened concerns
when accommodating would shutter their
operations or harm their cash flow to the
point that they couldn't pay their own suppliers, "
said Adam Ratliff, a partner at Warner
Norcross + Judd.
Ratliff urged both parties to have honest
conversations about what the customer
needs and what the supplier can afford.
4. EPA regulations
Suppliers will also be adjusting to new revisions
to EPA vehicle emissions standards,
which project EVs to constitute between 30
and 56 percent of U.S. light-duty sales in the
2030-32 model years.
That's down from a previous version of the
rule that projected around 67 percent of
sales by that time.
Suppliers have been navigating the risks of
either being left behind by not investing
enough in emerging EV technologies or creating
excess capacity if EV sales do not grow
at the expected rate.
But the new guidance provides suppliers
with more clarity as they prepare for higher
EV sales, said Ann Wilson, executive vice
president of government affairs at MEMA,
which represents companies in the supply
chain.
" We thought that was very important, " Wilson
said.
" It reflects customer demand and the fact
that the [supply chain] might not be mature
enough to make a very rapid increase in the
beginning years. "
CFO Yoichi Miyazaki said customers
are snapping up hybrids because they
are green and efficient, and because
technological improvements are also
making them fun to drive.
Prices have come down on a par
gasoline-powered vehicles in
with
some cases. And hybrids don't engender
the range anxiety that full-electrics
do because they don't require a
recharging grid, he said.
In the U.S., Toyota dealers have an
average 15-day supply of all vehicles.
But when it comes to hot-selling hybrids,
inventories drop to just five to
eight days, Miyazaki said.
Crucially, Toyota said its hybrid vehicles
are at least as profitable as its
gasoline-only models and usually
more profitable.
Toyota sees global hybrid vehicles
zooming ahead 25 percent to 4.7 million
this fiscal year. They will likely
account for 42 percent of Toyota's
worldwide
forecast.
RIVIAN
continued from Page 8
Rivian shut down its factory for much of April to make
the changes.
" The upgrade introduced new technologies and cost-focused
materials into the R1 vehicle platform, " Scaringe
said. " The plant re-tooling upgrade also provided the opportunity
to improve manufacturing processes and enable
the R1 line to run at an approximately 30 percent higher
line rate. "
One Wall Street analyst asked Scaringe about speculation
that Apple Inc. might be interested in some type of
collaboration with Rivian. Scaringe declined to comment.
Currently, Rivian vehicles do not offer Apple CarPlay,
which allows customers to mirror their phones onto a vehicle
infotainment screen.
New platform
With the retooling for R1 vehicles complete, Scaringe
said that Rivian is highly focused on the new low-cost platform
for the R2 and for another crossover, the R3, at a future
unspecified date.
" The launch of that platform with R2 in the first half of
2026 represents a step change in the scale of the addressable
market we can go after as a business, " Scaringe said.
Asked by an analyst if the R2 might launch sooner than
planned, Scaringe said the automaker developed its timeline
to make sure the product is ready at launch, with the
quality Rivian customers expect.
Separately last week, Rivian announced an $827 million
incentive package from the state of Illinois, but analysts
still expect Rivian to burn through billions in cash this
year.
In the fourth quarter of 2023, Rivian posted a net loss of
$1.5 billion, pushing its full-year loss to $5.4 billion. Rivian's
stock price has fallen more than 90 percent since its
initial public offering in November 2021.
volume, the company
Automotive News - May 13, 2024

Table of Contents for the Digital Edition of Automotive News - May 13, 2024
